Mongolia may become the world’s fastest-growing economy in the next decade as untapped mineral deposits lure investors, Renaissance Capital said in a note Friday.
“We think Mongolia may be able to position itself as the next Asian tiger or, as they prefer, Mongolian wolf, rather than the latest central Asian resource supplier,” strategists Roland Nash and Ovanes Oganisian wrote in a research note.
Mongolia’s “unstoppable” transformation will begin next year as foreign mining companies seek access to some of the world’s largest untapped deposits of gold, copper and coal.
Ivanhoe Mines and Rio Tinto Group signed an agreement with Mongolia in October to develop the $4 billion Oyu Tolgoi copper-gold project, which Rio has called the world’s biggest. Investment in the Oyu Tolgoi deposit will be equivalent on an annual basis to 10 percent of Mongolia’s current gross domestic product, Renaissance Capital said.
Mongolia may emerge as the world’s fastest-growing economy, taking over from Angola and Azerbaijan, according to the report.
Mongolia has the world’s biggest copper reserves and the ninth-largest coal supplies as well as deposits of uranium, rare-earth metals, gold, lead and zinc, the report said. Coal output will double in the next five years, while gold output will triple and copper production will quadruple, the investment bank said, citing official estimates.
Mongolia’s economy will probably double in dollar terms by 2014 or grow by 80 percent in the period under the International Monetary Fund’s “more conservative” estimates, Renaissance Capital said.